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Should employers cover the cost of work?

We’re seeing a shift towards more digital and physically disparate workforces, prompted ‘en masse’ by the Coronavirus pandemic but continued as chronic talent shortages force organisations to engage in a truly global search for skills.
 
And yet, many organisations are requesting that workers return to the office:
 
  • In the UK, our Salary Guide data showed that 43% of employees are currently working fully in the workplace. Nearly a quarter of employers believe that employees will need to be in the workplace ‘more often’.
  • In the US, 50% of leaders stated that their company plans to put in place requirements so that their employers return to in-person working in 2024.
  • 64% of CEOs globally antipate a full return to the office by 2026.
 
While it’s increasingly unlikely that the pendulum will swing either in favour of fully remote or wholly in-office working, many employees are being asked to work from the office more frequently. But for some, the time and resources afforded to come into the office is causing tension.
 
In a survey of nearly 13,000 people, 76% stated that employers should cover the cost of work. Expenses range from child or pet care, to commuting costs and food. Some also associate the ‘emotional’ cost of being away from home.
 
But is this a reasonable expectation of employers?
 
 

Making the case for covering the cost of work

 
With talent in short supply, covering the cost of work could become a key differentiator in a competitive market.
 
And more people than ever are acutely aware of the costs associated with coming into the office, with US workers believed to have spent between $2,000 and $5,000 on transport to work each year prior to the onset of the pandemic. Having been shown an alternative (one that doesn’t include high commuting and childcare expenses), many employees are reluctant to once again absorb these costs without question.
 
As workforces become increasingly blended, with contingent workers operating alongside full-time employees, there’s a growing awareness that this isn’t the norm everywhere, for everyone. Many contractors, for example, can claim back the cost of travel – albeit often in place of other ‘perks’ that permanent employees benefit from.
 
Covering the cost of work can also have benefits for employers. At a time when organisations are struggling with high disengagement rates and low productivity levels, removing cost barriers could encourage people back into the office for the right reasons – connection, collaborative thinking and a stronger culture.
 
 

Is covering costs a step too far for companies?

 
Having taken a more active role in the financial, emotional and mental well-being of their workforce over the last few years, it’s becoming more difficult for organisations to draw the line. But faced with ongoing economic instability, cost control has become a critical priority for CEOs in the year ahead.
 
Many of the respondents to our survey saw covering the cost of work as a part of employment. If employees have the option to work from home or from the office, they should bear the consequences of their decision. For example, if an employee chooses to work from home, they should pay for their own internet, phone and home office expenses. If an employee chooses to work from the office, they should pay for their own commuting, childcare, and clothing expenses.
 
There’s also a key question around equity. If ‘in-office’ workers receive a subsidy for their expenses, remote workers may feel at a disadvantage, especially if the decision to work-from-home is dictated by caring responsibilities, for example.
 
 

Some practical advice for employers

 
Our poll prompted an extensive debate on social media, adding yet another layer to the complex debate around ‘where’ work gets done. How can organisations balance the needs and expectations of their employees with the realities and challenges of their business?
 
Here are some practical tips for employers who are unsure what to do:
 
  • Conduct regular reviews of your Employer Value Proposition (EVP): Debates such as the ‘cost of work’ arise, often without warning. Organisations need to ensure that the benefits on offer always align with employee expectations. This will require timely reviews of your EVP, and perhaps even Contractor Value Proposition (CVP). You may need to make some trade-offs or adjustments to your priorities, such as reducing your office space or overhead costs, or reallocating funds to ensure you aren’t relying solely on a competitive salary in order to compete for talent.
  • Put flexibility first: So much of the debate generated by this poll centres around whether organisations were mandating a return to in-office working. A large number of our sample agreed that if organisations were asking people to come into the office when their job could be conducted remotely, they should consider covering the cost of work. For Bianca Stringuini, Global Head of Diversity, Equity and Inclusion here at Hays, the answer lies in priorisiting flexibility to ensure people are enabled to work how and where they are most productive. Placing the choice back in the hands of your people is more likely to create a collaborative solution, rather than a source of conflict.
 
 

Looking ahead

 
The ‘cost of work’ is the latest layer to be added to the increasingly complex debate around where work gets done, as organisations battle to maintain productivity, offer flexibility and control costs.
 
There is no ‘silver-bullet’ solution. The decision to cover costs will be driven by a unique blend of specific talent demands and organisational ambitions – as well as the availability of financial resources. We’d recommend that organisations take this opportunity to review both their EVP and CVP, ensuring it’s fit for purpose in an ever-evolving world of work.
 
Speak to the team today and discover how we can shape a stronger value proposition for your people.

 

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